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RIM seen becoming niche player with BB10

Feb 01, 2013 (The Manila Times - McClatchy-Tribune Information Services via COMTEX) --
The recent launching by Research in Motion (RIM) of its BlackBerry10 (BB10) will make the company a niche player in the growing smartphone market, which means that the company will never recover its long-lost status of being
the market leader.

According to market research firm Ovum, the huge challenge RIM faces is attracting new users to BB10 and its operating system.

"However, the challenge for the company will be to attract new users and those that have already moved to alternative smartphones," it said.

Ovum added that the BB10 can attract the interests of existing BlackBerry users, and that RIM's latest products will make its users somewhat stand out from those that use the more popular Android smartphone and even the Iphones.

"The Blackberry 10 platform offers a differentiated user experience in today's crowded and homogenous smartphone market. The Blackberry Z10 and Q10 will stand out from the Android masses and look distinct from Apple's iPhone.

The user experience of Blackberry 10 introduces some nice new features but importantly builds on Blackberry's UI heritage and therefore will certainly appeal to existing Blackberry users," it said.

Yet Ovum believes that will not be enough to make RIM a dominant player in the smartphone market, which has seen Apple, Samsung and even Chinese companies introduce their own products.

"However, Ovum believes that despite a well-designed Blackberry 10 platform that will certainly attract short-term interest from existing users, the company will struggle to appeal to a wider audience and in the long-term will become a niche player in the smartphone market," Ovum said.

Ovum draws upon over 400,000 interviews each year with business and technology, telecoms and sourcing decision-makers.

Make or break
The Canada-based company is banking on its BlackBerry 10 operating system and handsets in what some see as its last, best chance to remain a major player in an already competitive sector that is nevertheless attracting new entrants.

"The importance of this launch cannot be overstated," said Ramon Llamas, an analyst at the research firm IDC, adding that "There's going to be a lot of work that needs to be done to earn back respect."
RIM, whose stock is at about one-eighth of its valuation in 2008, said it plans to "significantly" increase its marketing budget for the BlackBerry 10 launch, and there will be events in New York and five other global cities.

The company website home page depicts a sleek black device against a black background, alongside the words:
"The Blackberry Experience. Re-designed. Re-engineered. Re-invented."
RIM is touting the system as a big change in smartphone technology.

"This is an entirely new operating system," said company spokesman Nick Manning.

"We think it's the first entirely new mobile operating system in about five years," he added.

More than 150 carriers worldwide have been testing the new platform, and RIM has given more than 8,000 prototypes to application developers.

BlackBerry 10 devices will be offered in an all-touchscreen version as well as in a model that keeps a physical keyboard. RIM said the system will break new ground by creating a user space that allows customers to flip between applications seamlessly and without first passing through a home page, to boost efficiency and multitasking.

This feature has caused real "excitement" as RIM has met with carriers around the world, RIM chief executive
Thorsten Heins told analysts on a December earnings conference call.

Gartner analyst Phillip Redman said that RIM still has a strong constituency of business users who prefer its hard keyboard and its reputation for strong network security.

While Redman doesn't think the BlackBerry 10 will surpass Apple's iPhone or Android products, the device "has great comeback potential," he wrote in a recent blog entry.

But the market is also getting more competitive with new Android devices, and RIM will be competing with Microsoft's Windows Phone for third place, and such conditions leave some analysts doubtful about the company's prospects.

"We don't buy the hype," Citi analyst Jim Suva said in a research note, pointing out that rivals such as China's Huawei are also entering the market.

Sterne, Agee and Leach analyst Shaw Wu noted that many of the high-end customers to which RIM is marketing have migrated to other devices.

"We see the company getting a degree of traction in this higher end market, but doubt there is a return to its former glory," Wu said.

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